How Nigeria can achieve 5.5 percent real GDP growth rate in 2025 – NESG

The Nigerian Economic Summit Group (NESG) yesterday unveiled its 2025 macroeconomic outlook, projecting that Nigeria’s economy could achieve a 5.5% Gross Domestic Growth (GDP) rate in 2025 if reforms are well implemented. The report titled, “Stabilisation in Transition: Rethinking Reform Strategies for 2025 and Beyond”, was unveiled at the Summit House, Lagos. In his presentation, […]

The Nigerian Economic Summit Group (NESG) yesterday unveiled its 2025 macroeconomic outlook, projecting that Nigeria’s economy could achieve a 5.5% Gross Domestic Growth (GDP) rate in 2025 if reforms are well implemented.

The report titled, “Stabilisation in Transition: Rethinking Reform Strategies for 2025 and Beyond”, was unveiled at the Summit House, Lagos.

In his presentation, the Chief Economist and Director of Research and Development at NESG, Olusegun Omisakin, said achieving the GDP growth rate hinges on three key strategies. 

He emphasised the need to control inflation, noting that the current inflationary trend is spiraling out of control.

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According to him, controlling inflation must go beyond what the monetary authority can address or what the fiscal authority can achieve through expansionary spending.

Omisakin hinted on the need to boost foreign exchange (FX) liquidity and stabilise the exchange rate, which is critical for fostering investor confidence and economic stability.

He also called for optimising fiscal performance, including prudent government spending and improving revenue generation to reduce fiscal deficits.

“Overall, macroeconomic signals are expected to show considerable Improvement. While the pace of deterioration in lagging indicators will slow, momentum in positive indicators is projected to sustain and strengthen further in the year.

“Interest rates and credit costs are likely to remain stable, with the Central Bank of Nigeria (CBN) potentially adopting a more accommodative monetary policy stance, including 3 relaxation of the Monetary Policy Rate (MPR), to complement fiscal stabilisation efforts

Real GDP growth is projected to experience a significant uptick, potentially reaching historical highs, driven by the expansion of economic activities and a broader base of growth-contributing sectors. Inflationary pressures are expected to ease as underlying factors weaken.

“Enhanced food production, exchange rate stability, reduced fuel Costs and other supportive measures are anticipated to collectively contribute to lower price levels during this period,” the NESG report indicated.

Omisakin warned that Nigeria’s current trajectory, marked by inefficient policy implementation and significant economic constraints, could result in a much lower growth rate.

Delivering the keynote address virtually, the CBN Governor, Olayemi Cardoso, said the apex bank will continue to strengthen financial institutions to enable them to effectively support the real sector.

Cardoso lamented that Nigeria’s economy has “very unfortunately been impacted by several years of mismanagement.”

He said, “We have discontinued monetisation of deficits, and with no multiple of exchange rate windows, we must not rest on our oars, especially as inflation remains higher than desired, closely beyond its potential and the foreign market continues to experience pressure.”

Formally launching the outlook, the NESG Chairman, Niyi Yusuf, said, “We hope we will sufficiently challenge to go for the 5.5 path way. 

“We hope this will be useful in terms of discourse and in terms of looking at various options. For me, the important thing is don’t let us take a binary look, we can walk and chew gum at the same time.”